November 03, 2017

5 million euro for social enterprises in the Western Balkans for the next 10 years

In the next 10 years, 5 mln EUR will be deployed for pre-seed and early stage financing for social enterprises in the Western Balkan region through the Mozaik Impact Fund, an initiative launched by the Mozaik Foundation based in Bosnia and Herzegovina. Mozaik, currently the only full member of the European Venture Philanthropy Association (EVPA) from the Western Balkans, joined forces with EVPA and 44 local and international institutions to help establish 500 new social business startups by 2025.

Mozaik Foundation

The Mozaik Impact Fund has recently invested in seven new social businesses, while it is currently working with 50 prospects in its incubator. The fund plans to invest in 15 social business startups in 2018, and gradually to build its capacity to annually invest in 50 startups or/and mature social businesses that solve real-life problems in their communities. It leverages on the success, ecosystem and infrastructure built over the years through Mozaik established initiatives such as the YouthBank, the leading regional youth empowerment and philanthropic program that has supported 1,892 cohesive youth-led community projects in Bosnia and Herzegovina alone.

The impact of the Mozaik Impact Fund is significantly larger than just the capital deployed. While the investments are expected to bring positive financial returns, the primary focus is on achieving direct social impact in the community where those businesses are operating – be it in the form of employment of vulnerable groups, or through delivering services that would not be otherwise accessible (i.e. extra educational activities). The businesses will benefit from additional value, derived from resources, time and efforts provided by the Mozaik team, mentors, other paid professionals.

The Mozaik Impact Fund is the first initiative developed within the EVPA Central Eastern Europe Fund Support Programme. Mozaik Impact Fund will receive 250.000 USD over the period of three years, that will contribute to the total size of the fund and its acceleration activities. Through the CEE Fund Support Programme, EVPA develops small social investment funds (up to 1 mln USD) that provide an attractive opportunity for local investors to get a hands-on experience in the social investment field and to avail from a funding facility (total of 1 mln USD) that is offered on a 3 : 1 matching basis.

“We identify, empower and invest in social entrepreneurs. Between 2016 and 2025 Mozaik Foundation will lead the development of a break-through generation of entrepreneurial and innovative youth in Bosnia and Herzegovina - a value-driven force that generates new social and economic value, creates new jobs and serves as a role model to other young people. EVPA, through its Fund Support Programme and with the support of its member organisations enable the development of impact funds in the region, which then act as catalysts of change in communities of Central and Eastern Europe.”  Zoran Puljic, Director of Mozaik Foundation

“Raising appropriate financing that balances social impact and financial return remains a challenge in Central Eastern Europe (CEE). According to EVPA survey, only 2% of venture philanthropy investments are allocated to CEE, while 67% remains in Western Europe. Social entrepreneurs face difficulties in accessing patient, early stage capital that does not demand high financial returns. That is why at EVPA, we are facilitating the development of pilot VP/SI funds in the region to increase resources, attract new investors, and mobilise local capital to grow the market. We are engaging individual and institutional investors to co-invest in the process of development of the funds and in the actual fund vehicles created at the country level”, says Ewa Konczal, EVPA Central Eastern Europe Manager.

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